Re: A Tsunami of Positive Real Estate Market News[ Edited ]
03-10-2012 10:06 PM - edited 03-10-2012 10:07 PM
How about the fact that they can FINALLY feel confidant about the likelihood that if they DO buy now, they're probably not going to lose equity?
First of all, Bob, I doubt that even you would speculate on what these factors mean for prices 7 or 8 years from now, and even you would not advise someone to buy a house unless he plans to stay in it 7 or 8 years. So whether or not equity is lost in the first 2-3 years (which is about all you could hope to predict from this data) is, or should be, a very minor concern of the present homebuyer. Didn't you yourself post a link just a little while ago to an article that said you should not avoid buying a house because the price might fall a little bit over the next year or two? Well, by the very same logic, you should not decide to buy a house just because the price might rise a little bit over the next year or two.
Second of all, the best possible guarantee of future equity is a lower price today. If I want to make a profit, I'm always better off buying when prices are falling than when they're rising. Prices that are falling absolutely must turn around someday. There is never a guarantee that rising prices will keep rising. Believing otherwise is exactly the mistake people who bought in 2006 -- when price were very high, but still rising -- made.
Face it, dude. You look at this entirely through the eyes of the seller. You can't wiggle out of it by the pretty weak argument that today's buyer is -- someday! possibly when the first grandkid is born! -- tomorrow's seller. That's like arguing that falling wages are really good for employees, because by gum, if the business really prospers and they own stock, someday they might become business owners -- and then they'll be glad of low wage costs.